Tulare County in Sound Fiscal Condition

page1At the April 7 Tulare County Board of Supervisors meeting, Jean Rousseau, county administrative officer, presented the county’s mid-term budget. The General Fund Fiscal Outlook for 2015-16 looks cautiously positive as the county is steadily recovering from the Great Recession.

Rousseau attributed Tulare County’s positive financial position to its conservative approach to spending and saving money. There is static to slow growth in the housing and commercial markets, and statewide sales taxes are still growing, but at a moderate rate. There has been an increase in local sales taxes over the calendar year.

The biggest impacts to the county’s budget are property taxes, retirement costs, worker’s compensation costs and the drought.

Property taxes provide two thirds of the general fund revenues. Rousseau was particularly interested in property tax trends during the last 40 years and their impacts on the county’s general fund. Until 2009, the county had never experienced a negative assessed value growth.

From 1976-2005, assessed value growth averaged 4 percent a year. During the economic boom from 2005–2009 the assessed value of land in Tulare County increased by an incredible 45 percent, he said. It is what Rousseau described as a “classic bubble.” The land values would have been assessed even higher if the assessor had a chance to get caught up and reassess all the properties, he said.

When the housing bubble burst, land values were hit with three consecutive years of negative assessed value. This left Tulare County with less money to provide the same expected services. The last three years have seen a significant recovery, but a conservative financial approach is still in order because no one has completely recovered from the recession.

“The gorilla in the room,” as Rousseau put it, is the drought. Water levels in wells continue to drop and are affecting the ability of farmers to generate agriculture income. This will lead to the lowering of land values. As agriculture land values decrease, it will have an adverse effect on Tulare County’s budget.

Right now, though, the county is in recovery. As a result of the slow recovery the county has been able to fill many positions left empty and add some positions. Tulare County is the number one employer in the county, with approximately 4,000 employees. The lion’s share of the new positions will be in the Health and Human Services Agency, with 30 new employees.

Supervisor Steve Worthley said, he was pleased with the fact that some departments were able to add positions, so that veteran employees can go back to working a normal work week instead working double time.

Worthley said, he feels very good where the county is positioned, and that we are doing well.

Supervisor Phil Cox said, Rousseau should be commended on how well he manages the county’s finances. The county has stayed fiscally conservative, is doing well and is healthy, he said.

“We made a plan and we are following the plan,” he said.

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